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POLITICO podcast: The Scrum

Boehner: Obama’s meetings ‘hopeful sign’

Obama’s failure to avert $85 billion in spending cutsknown as the sequesterunderscored the limits of his outside strategy and signaled that he could not persuade Republicans to raise revenue again without a comprehensive agreement to overhaul the Tax Code and entitlements.

A lull in the deadline-driven budget battles could soon give way to a fresh round of fiscal crises — from rising public pressure to lift the sequester to a looming summer deadline to increase the debt limit. If the president is to have any hope of resolving either fight to his liking, he’ll need more revenue. But Republicans won’t even consider it unless entitlement reforms are on the table.

So after more than two months in hiding, talk of a grand bargain has suddenly resurfaced in Washington.

Obama is doing things he’s never done — like dine out this week with a dozen Republican senators at a meal in which they talked fiscal issues, invite House Budget Committee Chairman Paul Ryan (R-Wis.) to the White House for lunch — and to re-engage with lawmakers after almost two years of campaigning against them.

“This week, we’ve gone 180,” House Speaker John Boehner (R-Ohio) said Thursday. “After being in office now for four years, he’s actually going to sit down and talk to members.”

There isn’t any irrational exuberance in the White House that a big deal is back within reach, one senior administration official said, but changing circumstances have given the president some hope.

“There is an increased focus on engagement because of the opportunity the circumstances provide,” White House press secretary Jay Carney said. “He is trying to make something good out of a bad situation. We don’t have a looming deadline. Republican leaders have made clear they’re not revisiting, at least not anytime soon, the idea of postponing the sequester in a balanced way. So the sequester is here. The budget process, regular order, is moving forward.”

Republican and Democrats broadly agree on the need for a grand bargain and the general outlines of what it should entail — tax reform, entitlement changes and spending cuts — but that’s where the agreement ends. Both sides acknowledge that a charm offensive won’t seal a deal, let alone get the two sides close.

Privately, House Republican leaders think they’ve checked two of the three boxes of a grand bargain: first, the Jan. 1 tax increases; second, the spending cuts via the sequester. Now, in their view, all that’s left is entitlement reform. Top Republicans are also skeptical Obama would agree to the kind of tax reform that House Republicans have drawn a firm line on: The revenue to be generated by closing loopholes would go tolowering rates.